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Financial advisors - what do they actually do?

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#1 KittyKatz



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Posted 19 June 2010 - 12:51 PM

Things are getting so tight with $$ at the moment that DH and I are fighting all the time. I'm under so much stress it's unbelievable, and I need some money advice.

TBH, I know what the problem - DH spends money we just don't have, but will try and justify it until he's blue in the face. One example - at the moment we have 4 cars..yes, 4. An old Charade (which my parents just bought as a little run around car), DH's 'fun'car, an old car I drive (which I'm more than happy with) and a station wagon he just bought from his brother as DH thought we needed a bigger car (which I didn't want). We are planning on selling the car I currently drive, so in a few months, we'll be back to 2 cars.

We also have about 35K worth of debt (not incl. the morgage), and now I'm PT at work after mat.leave, those repayments take about 1/2 my pay. Plus our morgage is 474K, and takes about 60% of his pay a month. I've suggested to DH that we add that debt into the morgage to ease up my pay, but he won't because the interest over a 30 year homeloan is more than just paying it back over about 6 years. He doesn't see the point that to me, its worth it because I can't keep going on like this with all the stress, and making money stretch that isn't there.

Anyway, I want to go to a professional and say 'this is what we earn, this is what we own, this is our morgage - sort it out for us that our day to day isn't so tight and stressful'. Does anyone actually do this sort of thing?? Also, a professional needs to tell DH what to do - he won;t listen to me, or even negotiate sad.gif

If anyone can help on where I can go to get this sort of help, it'd be greatly appreciated smile.gif
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#2 kisma


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Posted 19 June 2010 - 12:59 PM

Im not sure if a financial advisor coud help, my undertsanding is they help with investment etc, ie you have $100k you want to invest and they help with how. someone might be able to clarify that though.

You might be beter off getting in contact with Red Cross etc, as they can help with budgets. Centrelink also used to provide a financial service, so i would contact them and see if there is someone you can sit down with to get some help. (phone first rather than go in, as it may initally be someone over the phone that helps, cant remember exacts, sorry very tired today).

Oh and in a round about way im a bit in agreeance with your hubby in re to adding your loans onto the mortgage, purely because by the sounds of it hubby may take advantage of this extra money and spend it, and you very well could end up paying it out over the 30 years.
Good luck.
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#3 aChocLover


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Posted 19 June 2010 - 01:26 PM

Sounds like you need someone to run through some debt management, budgeting and cash flow management. Some financial advisors should provide this service - i'd start by asking at your bank (I know that some offer this as a free service if your mortgage is with them).

Re your Hubby being a spender .. so is mine sad.gif Very difficult to change the habit & it wasn't until I offloaded the stress and control of the purse to him, that he realised just what the situation was (didn't believe my whinges until he saw it for himself).

As for consolidating your debt, if cash flow is your major problem, then your Hubby might need to consider it. Although he'll seriously need to start looking at his spending habits, as you'll just end up in the same position that kisma eluded to. Unfortunately, some tough talks and a hard slog ahead sad.gif On a positive though, is certainly achievable smile.gif Good Luck!

#4 Jane Doe

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Posted 19 June 2010 - 01:28 PM

A lot of community centres have Financial Counsellors, and this is what it sounds like you need.

Alternatively, you could try somewhere like the Family Relationships Centres their number is 1800 050 321
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#5 drom


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Posted 19 June 2010 - 02:01 PM

I've seen this company advertise on TV and thought I'd post the link for you. I remembered reading an article on how the woman that started this company won the Telstra 2007 South Australian Business Woman Of The Year. I thougt it might be a good starting point for you.


#6 ~ela~



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Posted 19 June 2010 - 04:46 PM

I agree with Kisma, I thought Financial Advisors deal more with investment type situations.

If it were me I would head to your local bank where your mortgage is.

Numerous times we have done this and our bank manager has always put our needs before the bank profits. We are with a smaller bank and they have been nothing but helpful when we have gone in there feeling stressed, or when I need to give hubby a reality check and he isn't listening to me tongue.gif I guess because they are making enough money from us surely they can help out with a bit of advice, I mean they would rather us be paying interest on a home loan than be out renting where they aren't making any money off us.

Even if you call the bank where your home loan is and ask to make an appointment with the bank manager (probably a good place to start), they will then be able to put in basic terms that you have xxx amount coming in, yet your expenses are xxx. I know you know that you are struggling, but when we were in a similiar position all my nagging did nothing, yet when we went to our bank and hubby heard it from the bank manager suddenly he had more of an interest in things and realised I didn't just like hearing myself repeat the same stuff all the time.

I wouldn't be adding your current misc debt onto your mortgage. While our misc debt wasn't as much as yours, we just focused on paying min mortgage repayments so we could pay extra on this misc debt at the time (we had a personal loan for ~8g and a car loan for ~10g). Both loans we were paying back at around 11%, while our home loan was about 6.5%. I was actually the one that wanted to combine the PL, CL and HL to reduce our monthly repayments overall, however our bank manager said while it would give us breathing space atm it wouldn't benefit us in the long run - paying off interest over 30 years, rather than the 3 years we had left on the car and personal loans.

Would you look at going Interest Only on your home loan for 12 months or so to give you some breathing space and perhaps so you can knuckle down on your other debt in the meantime?

The above is merely what we have done, or what I would do, I am no Financial Advisor, but I would be heading to your bank and they should be able to help you out, or at least give you a few options for some breathing space, and hopefully help hubby understand how tight things are.

Good luck smile.gif

#7 ClaireBear



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Posted 19 June 2010 - 05:07 PM

There definitely are financial advisors out there that do that kind of thing. There is an ad on the radio all the time from a local company that promote debt consolidation. Maybe try your local yellow pages?
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#8 KittyKatz



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Posted 19 June 2010 - 05:32 PM

Thanks girls for all your advice. It's very hard going at the moment, so it's nice to be able to let it out here. I'll check out that website also Drom - had a quick look, but wil,l get into it deeper when hubby isn't around.

QUOTE(Ethans Mummy @ Jun 19 2010, 04:46 PM) View Post

Would you look at going Interest Only on your home loan for 12 months or so to give you some breathing space and perhaps so you can knuckle down on your other debt in the meantime?

Unfortunately we're already interest only sad.gif
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#9 Jessie`Elizabeth


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Posted 19 June 2010 - 06:21 PM

I dont have any real advice, but just had to say that my FH is the same.. but he seems to think that he can have whatever he wants whenever he wants with this wonderful thing called hire purchase/finance! dry.gif His latest thing is a new car.. he NEEDS a new golf GTI, depsite the 30k+ price tag and loan we would need to take out!

I do the budgets and handle the majoirty of the money and bills, and I cannot count the amount of stupid arguements we get into over his spending habits! And more often than not he cannot understand why he cant go out every weekend to the city and spend $400+ a night on taxis and alcohol! blink.gif

So eventually I was at my wits end and told that he has to do the budget and pay the bills and allocate the money.. and he came around very quickly.

He realised I wasn't just 'being mean' and not letting him spend money on things he wanted, but that I was making sure that all the bills were paid first and then having some money to play with!

I would try mybudget, a friend at work went through them and said they were good smile.gif

But if its ur partners spending habits thats the problem I would try giving him the household budget for 2 months or so and tell him that he can manage the money and make sure that all the bills are paid and food is bought etc, so he can see how much is really left over in the end.. it might give him the wake up call that he needs so that you can both get back on track smile.gif Otherwise he might see the consolidation loan as freeing up some extra money for him to spend

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#10 beachgurl


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Posted 19 June 2010 - 09:09 PM

Do you know if you are on the best (ie lowest) interest rate that you can be on at present? A reduction of interest rate by even .3% would make a difference with a loan amount of that size.

I think you should consolidate your loans. At the moment you are struggling and while you are paying more interest over a 30 year period, you have your sanity if you know you can afford to pay your bills. the average person/couple does not hold their mortgage for 30 years due to moving house or paying out the loan early and if you pay down the loan more quickly as you become more financially stable then you would be effectively paying down that consolidated amount.

You can go to a financial advisor but some mortgage brokers also do this. A lot of the companies that advertise their services for debt consolidation are mortgage brokers.

If you have any questions feel free to PM me, if nothing more than to check that you're on a good interest rate. If you are not, this could be the start of some simple changes to reduce your stress.

#11 loveheart


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Posted 19 June 2010 - 10:05 PM

My understanding is that a FA helps with setting up super and investments etc.

Would a spreadsheet style of budget help? We set one up where it lists our income(s) and all the bills we pay..it breaks it down from weekly to yearly. We have the opposite problem here...I have my head in the clouds whereas hubby loses sleep over our lack of money.

Once we actually sat down and I saw it i black and white..did I sit up and take notice.

I would maybe give your bank a buzz and organise a budget overhaul? Is there a friend he listens to?

He really needs to just start listening to you though!
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#12 Ariannan


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Posted 22 June 2010 - 05:37 PM

Hi ladies.

DH and I run a financial planning business so hopefully I can help out with this.

Financial advisers SHOULD offer professional advice in all areas of peoples' financial lives: budgeting, fixing up your life insurance, helping get your super on track, giving advice in areas such as tax etc to help you achieve your financial goals and/or help you get back on track if you're struggling.

Unfortunately... due to the way that the majority of financial planners are paid (i.e commission/ percentage of an investment amount etc) many planners only want to place investments for people who have already accumulated wealth. I think that this is where the misconception comes from in understanding what financial planners do. At the basis of it all, the people who often need the most help don't get it because of this misconception or by seeing one of the "run of the mill" financial planners who reinforce this idea in the community by turning people away who they can't make a commission out of.

My two cents worth: if you want help from a financial planner, there are two main things to look for:
1. try and see someone who is "independent" i.e has their own Australian Financial Services Licence (not under a large bank or other insitution). The problem IMO of seeing a financial planner attached to a bank etc is that they are restricted under that licence to only be able to offer a set amount of things so say for example you needed life insurance, they would only be able to recommend life insurance with a set range of companies (and usually only ones owned by their bank etc). This can mean that you may receive advice that although right for you circumstances may not be the absolute best thing for you IYKWIM.

2. Try to find someone who is "fee based" or "fee for service". This means that you pay them a set fee for their professional advice and they don't earn a commission. By paying a financial planner like you would any other professional, this means that YOU are employing them to work for YOU. They have the freedom to be able to give financial advice in grassroots areas such as budgeting etc that other planners can't as they would not get paid for their time in giving this advice.

Sorry for the ramble and if this is slightly off topic... if you want more info on this we have written some articles on our blog including this one: Independent Financial Planning so feel free to have a look and send me any questions. I hope that this is helpful to everyone.
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